Healthcare Fraud Touches Us All—Together We Can Fight It

Blue Cross Blue Shield of Arizona (BCBSAZ) is committed to sharing information to help healthcare consumers like you detect and prevent costly fraud, waste and abuse.

Did you know that the U.S. healthcare system loses tens of billions of dollars each year due to healthcare fraud? According to the Centers for Medicare and Medicaid Services (CMS), healthcare fraud is “the intentional act of deceit for the purposes of receiving payments that an individual or entity is not eligible to receive.” ¹

While fraud certainly is a problem, other forms of bad behavior like waste and abuse can also take a financial toll on the healthcare system and ultimately lead to higher monthly insurance premiums for consumers.

As a patient, would you know how to spot healthcare waste and abuse? Below are BCBSAZ’s definitions and some examples to help you become a more aware healthcare consumer:

Definitions

• Waste – Generally refers to overuse of medical services that result in unnecessary costs, misuse of resources, and that may also be inconsistent with acceptable medical guidelines.
   
• Abuse – Deliberate ignorance or reckless disregard of the truth; conduct that goes against and is inconsistent with acceptable business and/or medical practices resulting in payments that an individual or entity is not eligible to receive.

Examples

One of the most common forms of waste and abuse today is when a healthcare provider performs “medically unnecessary services”, i.e. orders tests, and supplies or other services on patients that are not needed in order to receive additional payments or referral fees.

Below is a case study and a recent real-life incident that can be categorized as a form of “medically unnecessary services” healthcare waste and abuse.

• Case Study: BCBSAZ members are often treated for drug addiction and/or pain management from their primary care physicians or pain management providers. These physicians routinely order weekly, bi-weekly and or monthly drug testing. The test results often show no presence of unknown drugs, yet the physician may send the test out for a second round of testing to confirm no presence of drugs. These test are routinely sent to non-contracted laboratories mainly out of state. Referring a negative drug test for additional testing is usually considered wasteful and unnecessary, costing both the consumer and the insurance company. Referring a drug test to a non-contracted provider when there are contracted providers in-network, is another way that providers might take advantage of both the consumer and the insurance company. Claims processed for out of network services mean a higher cost share for you, sometimes as much as the billed amount.
   
• In the News: In April 2016, The Herald Courier in Bristol, Virginia, reported that two individuals abused the healthcare system in a scheme designed to take advantage of America’s opioid epidemic—fraudulently billing several payers more than $14 million in medically unnecessary urine drug screens.
   

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1. CMS Fact Sheet: Common Types of Health Care Fraud (PDF, 465K)